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Government announces fuel price increases to help public finances

Previous Haitian governments have shied from keeping fuel prices in sync with world market prices, fearing inflation that would anger the population

People in this destitute Caribbean nation rushed to gas stations to top off their tanks before the price rises take effect on Monday.

The government had been negotiating with transport unions for more than a week so Haitians knew an increase was in the works.

Haiti exports only about a billion dollars worth of goods each year and imports more than three times that.

With that kind of deficit and meagre tax revenues, the government cannot even keep up with interest payments on debt it has with Venezuela, for instance.

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For the past 12 years, Haiti has benefited from a program instituted by the late Venezuelan socialist leader Hugo Chavez under which Caracas provided some countries of Latin America and the Caribbean with petroleum products at cut rate prices, with the bills payable over 25 years at an interest rate of one percent.

Since 2008, Haiti has in effect received two billion dollars in loans from Venezuela.

But it has failed to invest that money in economic development policies -- the idea behind the Chavez plan -- that would raise living standards and put the government in a position to pay back the debt.

Previous Haitian governments have shied from keeping fuel prices in sync with world market prices, fearing inflation that would anger the population.

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